OIL: Kurdistan Dispute Settlement Would Enable Restart of Russia Oil Projects
Feb-27 09:34
The settlement of dispute between the Iraqi Kurdistan and the federal government would allow Russian companies to restart oil projects in the region, according to Russia's Energy Minister Serge Tsivilev cited by TASS.
- Rosneft had suspended some operations in the region due to security concern located near the border with Syria.
- On Feb. 24, Iraq’s oil minister said Kurdistan oil flows via Turkey were hoping to resume within days following mounting reports of a resumption last weekend.
- Iraq will export 185kbpd from Kurdistan's oilfields through the Iraq-Turkey pipeline once the oil shipments resume, an Iraqi oil ministry official said, but Turkey is still yet to agree.
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CROSS ASSET: US Treasuries are pushing lower
Jan-28 09:30
- The Risk On tone is starting to take hold, with Europe starting to get dragged by the US.
- US Treasuries are seeing some similar unwind, with further selling interest pushing Futures to their respective lows, nothing fast but still some early notable volumes in the US.
- Immediate target in Bund is at 131.33, Yesterday's opening Gap.
ECB: Q4 BLS: Credit Standards Tightened With Further Tightening Expected (1/2)
Jan-28 09:28
- The ECB's Q4 Bank Lending Survey saw tightening in credit standards generally due to "higher perceived risks" and "banks' lower risk tolerance" (particularly in Germany and Italy for firms). It also saw a general pick up in demand for loans mainly due to "declining interest rates".
- In particular, credit standards for firms tightened (reported by a net balance of 7% of banks) from unchanged in Q3 and the press release notes that this is the "most pronounced tightening seen since Q3 2023". This tightening is expected to continue further in Q1-25 (a net balance of 10% of banks expect further net tightening of credit standards for firms). If we see this outturn, this would be above the historical average of 9%.
- There was further tightening in consumer credit standards of in Q4 (net balance of 6% in Q4 vs 6% in Q3), with the press release stating tightening reflects "concerns about deteriorating asset quality in this loan segment". The net balance is expected to pick up a little further to 7% in Q1-25.
- Credit standards for loans for house purchase were broadly balanced (net balance of 1% in Q4 vs -3% in Q3). This follows three quarters of easing, The net balance of banks which expect credit standards to tighten is expected to pick up 1ppt in Q1-25 to 2%.
EGBS: Most Spreads To Bunds A Touch Tighter As Equities Rally, DSLs Lag
Jan-28 09:23
Most EGBs are marginally tighter vs. Bunds this morning (less than 1bp), with an uptick in European equities helping that move
- Dutch paper the exception, following some pre-DSL auction concession (~0.5bp wider last).
- OAT/Bunds last 73.5bp with November closing lows at ~73bp eyed. A break below there would expose 71.6bp, which protects the psychological 70bp mark.
- French fiscal and political risks continue to limit further tightening pressure at this juncture, with headline cues on that front set to become more prominent in the coming days/weeks.
- BTP/Bunds holds around 110bp, with cycle closing lows at 106.4bp presenting the next downside target.
- Impact of supply from Italy and the Austrian long end syndication eyed for short-term cues.
